The revelations about the boy's behavior came after a judge warned state caseworkers that removing the boy and his sister from the people they called mom and dad is "the worst thing that could happen."

The boy threatened to kill his new foster parents. Three times in just the last two months, he's had to be put in an institution.

"Just a couple months ago he was here, he was doing good," said Joy Gambrel, referring to her 12-year-old grandson who along with her granddaughter had lived in the foster home of Brenda Lincoln and Willie Norman in Northeast Portland for two and a half years.

They all sat in court on Thursday as Multnomah County Court Judge Susan Svetkey revealed the troubles at the children's new foster home in Eugene where they were placed after being removed from Lincoln and Norman's home for reasons DHS never made clear.

Svetkey said about the boy: "He is exhausting to his current foster parents. He is in worse shape than he's ever been, significantly. ... We're trying to undo damage that we created."

The boy is now at the Jasper Mountain SAFE Center for emotionally disturbed children.

The lawyer for DHS, Dana Forman, admitted "This is a miserable case. ... We're trying to do what we can to move forward to minimize the damage that has been done. There is still damage that can be done if we're not careful."

DHS says the boy is now opening up to therapists and that he complained about an incident at Lincoln and Norman's home where they say a relative pushed the boy.

"I'm saying they're grasping at straws," Norman said in response. "They've been there two and a half years. If there was something going on in that house that made them unsafe they should have known it by now."

The state caseworker, Karey Menagh, who's been the target of much of the judge's frustration, has now been replaced.

Both the judge and DHS say they hope that will diffuse some of the tensions that have made this case so dis-functional and sad.

The judge ruled the children's mother can get her kids back if she can prove she'll stay off drugs and get her life together.

Norman and Lincoln are dropping their appeal to get their credentials back to be foster parents. Lawyers told them it's a losing battle.

They are now considering a civil rights lawsuit because some court observers have questioned whether race is a factor in this.